Victoria’s EV road tax starts to bite – and suck

The Victorian Government has wished EV and PHEV owners an Unhappy New Financial Year after issuing a demand, on July 1, that they send in a photo of their odometer readings so their world-beating electric vehicle road tax can be calculated.

While the rest of the world makes big efforts to encourage people to buy EVs, the Victorian government has decided to discourage that option by slapping anyone who does so with a special tax based on how many kilometres they drive. In the face of a public backlash the government offered $3000 subsidies for new lower-priced EVs to offset some of the additional tax.

The new tax comes into play in this new financial year and all EV – and, incredibly, PHEV – owners have to comply by sending in their odo readings.

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Owners will be hit with a tax of 2.5 cents per kilometre from July 1, meaning an annual bill of $375 for a car that travels 15,000km a year.

Anyone who doesn’t send in a photo as required will probably be shot, because this is the Police State of Victoria we’re talking about, but specifically the warning is that: “Failure to comply may result in your vehicle registration being suspended or cancelled, or other penalties.” That’s the wording in a cheery letter sent to all effected motorists on July 1.

What truly boggles the mind in is that owners of plug-in hybrids are also being taxed at 2c a kilometre, despite the fact that they also pay fuel tax (theoretically, the EV road tax is being levied to make up the disastrous shortfall in fuel levies that will result from people buying EVs. So PHEV owners pay this tax, even if they never actually run those cars in EV mode. It’s what the government might call a double word score. 

The Victorian Government is trying to give itself some political cover from its appalling and stupid tax by offering a rebate of $3,000 on new EV purchase, but that will only go to the first 4000 people to apply. Then the authorities are going to reanalyse how much it’s costing, and no doubt abolish it.